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SAN FRANCISCO--A case in which the federal government seized domain names being used by a sports programming streaming website was dismissed at the request of prosecutors, according to an Aug. 29 order by the U.S. District Court for the Southern District of New York (United States v. Rojadirecta.org, S.D.N.Y., No. 11-cv-04139-PAC, dismissed 8/29/12).

The government, in a letter to Judge Paul A. Crotty cited “certain recent judicial authority involving issues germane” to the case and the “particular circumstances of this litigation” in seeking to dismiss its complaint.

The move comes two days after the U.S. Court of Appeals for the Second Circuit held that a paid online service that streams broadcast content live to subscribers and offers a remote digital video recording service is not a “cable system” entitled to a compulsory license under the Copyright Act (166 PTD, 8/28/12).

Representatives of the Immigration and Customs Enforcement agency could not be reached for comment Aug. 29. Assistant U.S. Attorney Christopher Frey, who argued on behalf of the government, referred comments to the press office of the U.S. Attorney's Office for the Southern District of New York's press office, which declined comment.

Seizures

Rojadirecta.org was among several domain names that authorities seized in January 2011 for publishing hyperlinks to unauthorized streaming videos (23 PTD, 2/3/11).

“The decision to seek dismissal of this case will best promote judicial economy and serve the interests of justice,” according to the letter from Frey and U.S. Attorney Preet Bharara.

The order returning the domain names also directs the Public Interest Registry to return rojadirecta.org and VeriSign Inc. to return rojadireca.com to the registrants.

Hundreds Domains Seized

Of the nearly 900 domain names seized through Operation in Our Sites, the Rojadirect owner was the only domain name owner to challenge ICE's seizure in federal court.

“This shows that when a domain name owner fights back and challenges what was in this case a legally improper seizure, that investment of time and resources can pay off even where this is a dispute that should never have arisen of the first place,” said Joseph Gratz of Durie Tangri, San Francisco, who represented Rojadirect.

“This is not a dispute that left anybody better off. My client has been without their domain name for 20 months now, the government has been litigating a case that they have now, after substantial briefing and argument have realized is a case that should have never been brought,” Gratz told BNA on Aug. 29.

“The winner here, if there is one, will be the interest of freedom and the freedom of speech against government action to seize the means of speech,” Gratz said.

The ICE-led National Intellectual Property Rights Coordination Center in July announced seizure of 70 websites that the agency said were illegally selling counterfeit merchandise (135 PTD, 7/16/12).

'Outsourcing’ Enforcement

The sites may be returned but the economic cost cannot be recovered from the government.

“This is one reason I believe that outsourcing cases to the federal government is improper because if copyright holders had brought this lawsuit and suppressed this domain name by getting a preliminary injunction, they would have had to put a cash bond in place’’ to protect the owner, Andrew Bridges of Fenwick & West, San Francisco.

Copyright holders get the government to cover their legal expenses and “they get to completely avoid the risk of having to put their own money at risk by having to put up a bond,” Bridges told BNA Aug. 29.

Bridges represented a second registrant, the operator of DaJaz1.com, a music blog, whose site was seized during an early round of seizures in November 2010. He declined to comment on redress issues.

Recent Precedent

The iVi Inc. case “made it very, very clear that this is just about streaming, and streaming is just about public performance, and public performance isn't subject to the same” provisions as reproductions and distributions, Bridges said.

Bridges pointed to the Seventh Circuit's Aug. 2 ruling that the host of a “social bookmarking’’ website is unlikely liable for contributory copyright infringement based on a service that allows users to “bookmark” infringing content uploaded on third-party sites, and play that content through an embedded link surrounded by ads. Flava Works Inc. v. Gunter, 7th Cir., No. 11-3190 (7th Cir. Aug. 2, 2012).

Regarding that decision, Bridges said, “it would have been very hard for the government to make a criminal case based on a site that links to streaming sites.”

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